Nasdaq up seven sessions in a row

Apple Computer gains on price target upgrades

By

MarkCotton

NEW YORK (MarketWatch) -- U.S. stocks ended higher Wednesday as strength in the technology sector helped the Nasdaq Composite clinch its seventh straight session of gains, while the Dow Jones Industrial Average overcame early weakness sparked by a profit warning from DuPont.

The Dow industrials
DJIA, +0.72%
ended just off their high for the session, up 31.86 points at 11,043.44.

"We've had a tremendous upswing in stocks and that's obviously garnered a lot of attention and I think we're probably seeing some new money move into the market," said Stephen Massocca, president and head of trading at Pacific Growth Equities. "As for the DuPont news, it was very company specific."

John Forelli, senior vice-president and portfolio manager at Independence Investments, said the DuPont warning must be put in context.

"We have to remember that we're going to see the bad reports come out early so I think it's too early for investors to give up on the earnings season."

On the broader market for equities, advancers had an 18 to 14 edge over decliners on the New York Stock Exchange, and led by a narrower 15 to 14 score on the Nasdaq.

By sector, Internet stocks
$GIN
and airlines ($XAL) were the most notable decliners.

Semiconductors
SOX, -0.36%
brokers
$XBD
and computer hardware stocks
$GHA
are three of the sectors showing the most significant gains.

Volume was heavy with 1.74 billion shares traded on the Big Board, while 2.39 billion shares were exchanged on the Nasdaq.

Crude, gold, dollar, bonds

Crude futures ended higher, with one analyst saying the market is being bid up by speculators, but nervousness over Iran's plans to restart its nuclear program was also in play.

Earlier, the benchmark February contract fell to a session low of $62.60 after an Energy Department report showing weekly gasoline and distillate inventories, which includes winter heating oil, far exceeded estimates. The news helped offset a larger-than-expected decline in crude supplies. The benchmark February contract settled at $63.94 a barrel, up 57 cents. See Futures Movers

Gold for February delivery recovered from early weakness to end higher, amid continued bullish sentiment for the metal. The contract was up $4.40 at $550.10 an ounce, off an early low of $541. See Metals Stocks

Treasurys ended lower after an auction of 5-year notes drew lackluster demand, and as fixed-income traders digested by a monetary-policy speech by New York Federal Reserve President Timothy Geithner.

While the Fed shouldn't hike rates to pop perceived asset bubbles, asset price moves have become more important for the course of interest rates, said Geithner, in remarks prepared for delivery to the New York Association for Business Economics. See full story.

The benchmark 10-year Treasury note was last down 7/32 at 100 11/32, yielding 4.46%. See Bond Report

On the currency markets, the dollar was lower against the euro and the yen. The euro was up 0.5% at $1.2121. Against the Japanese yen, the greenback fell 0.2% to 114.13.

The dollar has been under pressure due to strong signals that the Federal Reserve is on the verge of wrapping up its current series of rate increases. See Currencies

Dow stocks in focus

Shares of DuPont
DD, +0.23%
fell as much as 4.2% to a session low of $40.76 after the chemicals manufacturer became the second Dow component after Alcoa Inc.
AA, +2.36%
to disappoint investors on earnings. The company warned that its fourth-quarter will not meet analysts' expectations due to hurricane-linked disruptions. The stock pared losses to end the day, down $1.41, or 3.3% at $41.14. See full story.

Hewlett-Packard,
HPQ, -2.35%
also in the Dow, was 56 cents higher at $31.34. The company got an upgrade from Prudential Equity, which noted positive cost savings. Read the Ratings Game

Johnson & Johnson
JNJ, +1.14%
was in focus after the New York Times said the drug giant is considering a new bid for medical devices maker Guidant Corp.
GDT

The paper said Guidant's board has already met and declared Boston Scientific Corp.'s
BSX, +0.97%
$25 billion offer superior to Johnson & Johnson's original $21.4 billion bid, a move which would have triggered a five-day deadline for the pharmaceutical company to make a new offer. Johnson & Johnson shares fell 60 cents to $62.50. Boston Scientific's stock was off $1.07 at $25.41, while shares of Guidant rose $1.05 to $70.44. See full story.

Other stock standouts

Shares in Apple Computer Inc.
AAPL, +1.63%
climbed 3.8% to $83.90 after brokers UBS and Bank of America raised their price target on the maker of the iPod digital music player. Shares in the company rallied Tuesday when Chief Executive Steve Jobs announced December quarter revenue had outpaced estimates.

Yahoo Inc.
YHOO, +0.85%
was 2.6% lower at $41.87 after Merrill Lynch downgraded the stock to neutral from buy, noting limited prospects for its Internal portal.

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